Live Nation Entertainment, Inc. (LYV) 10-K Annual report pursuant to section 13 and 15(d) Filed on 02/28/2011 Filed Period 12/31/2010 Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K x ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2010, OR ¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number 001-32601 LIVE NATION ENTERTAINMENT, INC. (Exact name of registrant as specified in its charter) Delaware 20-3247759 (State of Incorporation) (I.R.S. Employer Identification No.) 9348 Civic Center Drive Beverly Hills, CA 90210 (Address of principal executive offices, including zip code) (310) 867-7000 (Registrant's telephone number, including area code) Securities registered pursuant to Section 12(b) of the Act: Title of Each Class Name of Each Exchange on which Registered Common Stock, $.01 Par Value per Share; New York Stock Exchange Preferred Stock Purchase Rights Securities registered pursuant to Section 12(g) of the Act: None Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. x Yes ¨ No Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. ¨ Yes x No Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and 2) has been subject to such filing requirements for the past 90 days. x Yes ¨ No Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). ¨ Yes ¨ No Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. x Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one): Large accelerated filer x Accelerated filer ¨ Non-accelerated filer ¨ Smaller reporting company ¨ (Do not check if a smaller reporting company) Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ¨ Yes x No On June 30, 2010, the last business day of the registrant's most recently completed second fiscal quarter, the aggregate market value of the Common Stock beneficially held by non- affiliates of the registrant was approximately $1.2 billion. (For purposes hereof, directors, executive officers and 10% or greater stockholders have been deemed affiliates). On February 22, 2011, there were 181,677,930 outstanding shares of the registrant's common stock, $0.01 par value per share, including 2,339,524 shares of unvested restricted stock awards and excluding 772,743 shares held in treasury. DOCUMENTS INCORPORATED BY REFERENCE Portions of our Definitive Proxy Statement for the 2011 Annual Meeting of Stockholders, expected to be filed within 120 days of our fiscal year end, are incorporated by reference into Part III. Table of Contents LIVE NATION ENTERTAINMENT, INC. INDEX TO FORM 10-K Page PART I ITEM 1. BUSINESS 2 ITEM 1A. RISK FACTORS 22 ITEM 1B. UNRESOLVED STAFF COMMENTS 42 ITEM 2. PROPERTIES 42 ITEM 3. LEGAL PROCEEDINGS 42 PART II ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES 45 ITEM 6. SELECTED FINANCIAL DATA 46 ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 47 ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 75 ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA 76 ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE 132 ITEM 9A. CONTROLS AND PROCEDURES 132 ITEM 9B. OTHER INFORMATION 134 PART III ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE 134 ITEM 11. EXECUTIVE COMPENSATION 134 ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS 134 ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE 134 ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES 134 PART IV ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES 135 Table of Contents LIVE NATION ENTERTAINMENT, INC. GLOSSARY OF KEY TERMS ADA Americans with Disabilities Act of 1990 AEG Anschutz Entertainment Group AMG Academy Music Holdings Limited Group AOI Adjusted operating income (loss) Azoff Trust The Azoff Family Trust of 1997, of which Irving Azoff is co-Trustee Brand New Live Brand New Live B.V. Clear Channel Clear Channel Communications, Inc. Comcast Comcast-Spectacor, L.P. Company Live Nation Entertainment, Inc. and subsidiaries CPI Concert Productions International CPI Companies CPI and related companies and subsidiaries CTS CTS Eventim AG DDA United Kingdom's Disability Discrimination Act 1995 De-Lux De-Lux Merchandise Company Limited DF Concerts DFC Holdings Limited DOJ United States Department of Justice Dominion Dominion Theatre Investments Limited F&P Italia Friends & Partners Italia S.r.l. FASB Financial Accounting Standards Board FCPA Foreign Corrupt Practices Act FLMG FLMG Holdings Corp., a wholly-owned subsidiary of Live Nation FTC Federal Trade Commission Front Line Front Line Management Group, Inc. GAAP United States Generally Accepted Accounting Principles Gellman Gellman Management LLC Get Live 2 Get Live 2 S.r.l. HOB HOB Entertainment, Inc. IAC IAC/InterActiveCorp IRS United States Internal Revenue Service KSC KSC Consulting (Barbados) Inc. Liberty Media Liberty Media Corporation Live in Italy Live s.r.l. Live Nation Live Nation Entertainment, Inc., formerly known as Live Nation, Inc., and subsidiaries LN—Haymon Live Nation—Haymon Ventures, LLC Luger Lugerinc. AB Mean Fiddler Mean Fiddler Music Group, PLC Merger Merger between Live Nation, Inc. and Ticketmaster Entertainment, Inc. announced in February 2009 and consummated in January 2010 Merger Agreement Agreement and Plan of Merger, dated February 10, 2009 and consummated on January 25, 2010, between Live Nation, Inc. and Ticketmaster Entertainment, Inc. Mirage Mirage Promotions FZ-LLC MLK Marek Lieberberg Konzertagentur Moondog Moondog Entertainment AB OCI Other comprehensive income (loss) Paciolan Paciolan, Inc. Parcolimpico Parcolimpico S.r.l. SEC United States Securities and Exchange Commission Separation The contribution and transfer by Clear Channel of substantially all of its entertainment assets and liabilities to Live Nation Spincos Collective referral to Ticketmaster and other companies spun off from IAC on August 20, 2008 Tecjet Tecjet Limited Ticketmaster For periods prior to May 6, 2010, Ticketmaster means Ticketmaster Entertainment LLC and its predecessor companies (including without limitation Ticketmaster Entertainment, Inc.); for periods on and after May 6, 2010, Ticketmaster means the Ticketmaster ticketing business of the Company Ticketnet Ticketnet S.A. TicketsNow TNow Entertainment Group, Inc. 1 Table of Contents PART I "Live Nation" (which may be referred to as the "Company", "we", "us" or "our") means Live Nation Entertainment, Inc. and its subsidiaries, or one of our segments or subsidiaries, as the context requires. Special Note About Forward-Looking Statements Certain statements contained in this Form 10-K (or otherwise made by us or on our behalf from time to time in other reports, filings with the SEC, news releases, conferences, internet postings or otherwise) that are not statements of historical fact constitute "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act of 1934, as amended, notwithstanding that such statements are not specifically identified. Forward-looking statements include, but are not limited to, statements about our financial position, business strategy, competitive position, potential growth opportunities, potential operating performance improvements, the effects of competition, the effects of future legislation or regulations and plans and objectives of our management for future operations. We have based our forward-looking statements on our beliefs and assumptions based on information available to us at the time the statements are made. Use of the words "may," "should," "continue," "plan," "potential," "anticipate," "believe," "estimate," "expect," "intend," "outlook," "could," "target," "project," "seek," "predict," or variations of such words and similar expressions are intended to identify forward-looking statements but are not the exclusive means of identifying such statements. Forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties that could cause actual results to differ materially from those in such statements. Factors that could cause actual results to differ from those discussed in the forward-looking statements include, but are not limited to, those set forth under Item 1A.—Risk Factors as well as other factors described herein or in our quarterly and other reports we file with the SEC (collectively, "cautionary statements"). Based upon changing conditions, should any one or more of these risks or uncertainties materialize, or should any underlying assumptions prove incorrect, actual results may vary materially from those described in any forward-looking statements.